IDFC to buy Gurgaon expressway from DSC

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Timsy Jaipuria: New Delhi, Jan 26 2013, 02:02 IST

The National Highways Authority of India (NHAI) and IDFC are close to an agreement under which the latter will take over the bedevilled Delhi-Gurgaon expressway project from the current developer DSC. Although the final contours of the deal are still being negotiated, sources told FE that IDFC, the lead banker in the lender consortium, will buy out the project completely. Under the deal, IDFC will likely pay R1 for all the shares of Delhi-Gurgaon Super Connectivity (DSCL), the concessionaire of the Delhi-Gurgaon expressway, and will take over its entire debt of R1,600 crore.

Following the termination notice issued by the NHAI in February 2012 to DSC alleging operational incompetence and raising of loans of R1,275 crore from IDFC without prior approval from the authority, DSC had moved the Delhi High Court challenging the NHAI move. A court-initiated settlement was reached between the two under which DSC is required to construct more toll plazas along the expressway to ease traffic but NHAI remained sceptical of the developer’s ability to run the project.

“IDFC had earlier expressed interest to buy out 74% of the DSCL equity but we asked them to buy out 100%,” an official said. Earlier, IDFC had written to NHAI expressing its intent to buy a 74% stake in the project, a proposal that would have kept 24.8% with DSC, the sole owner of DGSCL right now, and 1.2% with the Jaypee Group. “DSC’s stake would serve no purpose when IDFC will have majority. Our experience has been bad with the

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